88R3524 JES-D     By: Bucy, Capriglione, Button, Howard H.B. No. 3768       A BILL TO BE ENTITLED   AN ACT   relating to the formation of decentralized unincorporated   associations and the use of distributed ledger or blockchain   technology for certain business purposes; authorizing a fee.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 1.002, Business Organizations Code, is   amended by adding Subdivisions (15-a), (16-a), (78-b), and (82-b)   and amending Subdivisions (78-a), (82-a), and (89) to read as   follows:                (15-a)  "Digital asset" means an electronic record in   which a person has a right or interest. The term does not include an   underlying asset, unless the asset is itself an electronic record.                (16-a)  "Distributed ledger technology" means a   distributed ledger protocol that:                      (A)  is a designated regulatory model of software   that governs the rules, operations, and communication between   intersection and connection points in a telecommunications network   and supporting infrastructure;                      (B)  includes the computer software or hardware,   or collections of computer software or hardware, that use or enable   a distributed ledger, including blockchain; and                      (C)  uses a distributed, shared, and replicated   ledger, which may:                            (i)  be public or private;                            (ii)  be permissioned or permissionless; and                            (iii)  include the use of a digital asset as   a medium of electronic exchange.                (78-a)  "Record" means information that is inscribed on   a tangible medium or that is stored in an electronic or other medium   and is retrievable in a perceivable form, including information   inscribed on blockchain or distributed ledger technology.                (78-b)  "Registered series" means a series of a   domestic limited liability company that is formed as a registered   series in accordance with Section 101.602.                (82-a)  "Smart contract" means an event-driven   computer program that executes on distributed ledger technology   used to automate a transaction, including a transaction that:                      (A)  takes custody over and instructs transfer of   assets on that ledger;                      (B)  creates and transmits digital assets;                      (C)  synchronizes information; or                      (D)  authenticates user rights and conveys access   to software applications.                (82-b)  "Social purposes" means one or more purposes of   a for-profit corporation that are specified in the corporation's   certificate of formation and consist of promoting one or more   positive impacts on society or the environment or of minimizing one   or more adverse impacts of the corporation's activities on society   or the environment. Those impacts may include:                      (A)  providing low-income or underserved   individuals or communities with beneficial products or services;                      (B)  promoting economic opportunity for   individuals or communities beyond the creation of jobs in the   normal course of business;                      (C)  preserving the environment;                      (D)  improving human health;                      (E)  promoting the arts, sciences, or advancement   of knowledge;                      (F)  increasing the flow of capital to entities   with a social purpose; and                      (G)  conferring any particular benefit on society   or the environment.                (89)  "Writing" or "written" means an expression of   words, letters, characters, numbers, symbols, figures, or other   textual information that is inscribed on a tangible medium or that   is stored in an electronic or other medium that is retrievable in a   perceivable form.  Unless the context requires otherwise, the term:                      (A)  includes stored or transmitted electronic   data, electronic transmissions, blockchain or distributed ledger   technology, and reproductions of writings; and                      (B)  does not include sound or video recordings of   speech other than transcriptions that are otherwise writings.          SECTION 2.  Subchapter A, Chapter 1, Business Organizations   Code, is amended by adding Section 1.010 to read as follows:          Sec. 1.010.  CERTAIN PROVISIONS RELATED TO BLOCKCHAIN AND   DISTRIBUTED LEDGER TECHNOLOGY. For purposes of this code:                (1)  a requirement for a person's signature is   satisfied by the submission of a blockchain that electronically   contains the signature or verifies the intent of a person to provide   the signature;                (2)  a requirement for a record to be in writing is   satisfied by the submission of a blockchain that electronically   contains the record; and                (3)  a smart contract, record, or signature may not be   excluded as evidence in a proceeding solely because blockchain or   distributed ledger technology was used to create, store, or verify   the smart contract, record, or signature.          SECTION 3.  Section 6.002(a), Business Organizations Code,   is amended to read as follows:          (a)  Subject to this code and the governing documents of a   domestic entity, the owners, members, or governing persons of the   entity, or a committee of the owners, members, or governing   persons, may hold meetings by using a conference telephone or   similar communications equipment, or another suitable electronic   communications system, including videoconferencing technology, an   electronic data system, [or] the Internet, or any combination, if   the telephone or other equipment or system permits each person   participating in the meeting to communicate with all other persons   participating in the meeting.          SECTION 4.  Section 101.052, Business Organizations Code, is   amended by adding Subsection (g) to read as follows:          (g)  A company agreement may be composed of computer code and   maintained on blockchain or distributed ledger technology in full   or in part if the record of the agreement is capable of being   retained and accurately reproduced for later reference.          SECTION 5.  Section 101.501(a), Business Organizations   Code, is amended to read as follows:          (a)  In addition to the books and records required to be kept   under Section 3.151, a limited liability company shall keep at its   principal office in the United States, keep on an electronic data   system, or make available to a person at its principal office in the   United States not later than the fifth day after the date the person   submits a written request to examine the books and records of the   company under Section 3.152(a) or 101.502:                (1)  a current list that states:                      (A)  the percentage or other interest in the   limited liability company owned by each member; and                      (B)  if one or more classes or groups of   membership interests are established in or under the certificate of   formation or company agreement, the names of the members of each   specified class or group;                (2)  a copy of the company's federal, state, and local   tax information or income tax returns for each of the six preceding   tax years;                (3)  a copy of the company's certificate of formation,   including any amendments to or restatements of the certificate of   formation;                (4)  if the company agreement is in writing, a copy of   the company agreement, including any amendments to or restatements   of the company agreement;                (5)  an executed copy of any powers of attorney;                (6)  a copy of any document that establishes a class or   group of members of the company as provided by the company   agreement; and                (7)  except as provided by Subsection (b), a written   statement of:                      (A)  the amount of a cash contribution and a   description and statement of the agreed value of any other   contribution made or agreed to be made by each member;                      (B)  the dates any additional contributions are to   be made by a member;                      (C)  any event the occurrence of which requires a   member to make additional contributions;                      (D)  any event the occurrence of which requires   the winding up of the company; and                      (E)  the date each member became a member of the   company.          SECTION 6.  Title 6, Business Organizations Code, is amended   by adding Chapter 253 to read as follows:   CHAPTER 253. DECENTRALIZED UNINCORPORATED ASSOCIATIONS          Sec. 253.001.  DEFINITIONS. In this chapter:                (1)  "Administrator" means a person authorized by the   members of a decentralized unincorporated association to fulfill   administrative or operational tasks at the direction of the   members.                (2)  "Decentralized unincorporated association" means   an unincorporated association:                      (A)  consisting of at least 500 members joined by   mutual consent under an agreement, that may be in writing or   inferred from conduct, for a common purpose, other than to operate a   business for profit except as permitted under Section 253.004;                      (B)  that has elected to be formed under this   chapter; and                      (C)  is not formed under any other law governing   the association's organization and operation.                (3)  "Established practices" means the practices used   by a decentralized unincorporated association without material   change during the most recent five years of the association's   existence, or if the association has existed for less than five   years, during the association's entire existence.                (4)  "Governing principles" means all agreements and   any amendment or restatement of those agreements, including any   articles of organization, consensus formation algorithms, or   enacted governance proposals, that govern the purpose or operation   of a decentralized unincorporated association and the rights and   obligations of the association's members and administrators,   whether contained in a record, implied from the association's   established practices, or both.                (5)  "Member" means a person that, under the governing   principles of a decentralized unincorporated association, may   participate in:                      (A)  the development of the policies and   activities of the association; and                      (B)  the selection of the association's   administrators.          Sec. 253.002.  SUPPLEMENTARY GENERAL PRINCIPLES OF LAW AND   EQUITY. (a) Principles of law and equity supplement this chapter   unless displaced by a particular provision of this chapter.          (b)  This chapter may not be interpreted to repeal or modify   a statute or rule for an entity that does not elect to be formed as a   decentralized unincorporated association.          Sec. 253.003.  GOVERNING LAW; TERRITORIAL APPLICATION. (a)   Except as otherwise provided by Subsection (b), the law of this   state governs any decentralized unincorporated association that is   formed or operates in this state.          (b)  A decentralized unincorporated association's governing   principles must identify the jurisdiction in which the   decentralized unincorporated association is formed.          Sec. 253.004.  DISTRIBUTION PROHIBITED; COMPENSATION AND   OTHER PERMITTED PAYMENTS. (a) A decentralized unincorporated   association may carry on any business activity in which the   association may lawfully engage for profit and apply any profit   that results from the business activity in accordance with   Subsection (c).          (b)  Except as provided by Subsection (c), a decentralized   unincorporated association may not pay dividends or distribute any   part of the association's income or profit to the association's   members or administrators.          (c)  A decentralized unincorporated association may:                (1)  pay reasonable compensation to or reimburse   reasonable expenses incurred by the association's members and   administrators, or to a person who is not a member or administrator,   for services rendered to the association, including for the   administration and operation of the association, including for:                      (A)  the provision of collateral for the   self-insurance of the association;                      (B)  voting; and                      (C)  participation;                (2)  confer benefits on the association's members or   administrators in conformity with the association's common   nonprofit purpose or purposes, if any;                (3)  repurchase membership interests to the extent   authorized by the association's governing principles; and                (4)  make distributions of property to members on   winding up and termination to the extent provided by Section   253.027.          Sec. 253.005.  LEGAL ENTITY; PERPETUAL EXISTENCE; POWERS.   (a) A decentralized unincorporated association is a legal entity   distinct from the association's members and administrators.          (b)  A decentralized unincorporated association has   perpetual duration unless the association's governing principles   otherwise specify.          (c)  A decentralized unincorporated association has the   power to do all things necessary or convenient to carry on the   association's activities or affairs.          Sec. 253.006.  REAL AND PERSONAL PROPERTY; DECENTRALIZED   UNINCORPORATED ASSOCIATION AS BENEFICIARY, LEGATEE, OR DEVISEE.   (a) A decentralized unincorporated association may, in the name of   the association, acquire, hold, encumber, or transfer an estate or   interest in real or personal property.          (b)  A decentralized unincorporated association may be a   beneficiary of a trust or contract, legatee, or devisee.          Sec. 253.007.  STATEMENT OF AUTHORITY AS TO REAL PROPERTY.   (a) A decentralized unincorporated association shall execute and   record a statement of authority to transfer an estate or interest in   real property in the name of the association.          (b)  An estate or interest in real property in the name of a   decentralized unincorporated association may be transferred by a   person so authorized in a statement of authority recorded in the   office of the county clerk in which a transfer of the property would   be recorded.          (c)  A statement of authority must contain:                (1)  the name of the decentralized unincorporated   association;                (2)  the address in this state, including the street   address, if any, of the association, or if the association does not   have an address in this state, the association's address out of   state;                (3)  the name or title of the person authorized to   transfer an estate or interest in real property held in the name of   the association; and                (4)  the action, procedure, or vote of the association   that authorizes the person to transfer the real property of the   association and to execute the statement of authority.          (d)  A statement of authority must be executed in the same   manner as a deed. The person who executes the statement of   authority may not be the person named in the statement of authority   as authorized to transfer the estate or interest.          (e)  The county clerk may collect a fee for recording the   statement of authority in the amount authorized for recording a   transfer of real property.          (f)  An amendment, including a cancellation, of a statement   of authority must meet the requirements for execution and recording   of an original statement. Unless canceled earlier, a recorded   statement of authority or the most recent amendment to the   statement is canceled by operation of law on the fifth anniversary   of the date of the most recent recording.          (g)  If the record title to real property is in the name of a   decentralized unincorporated association and the statement of   authority is recorded in the office of the county clerk in which a   transfer of real property would be recorded, the authority of the   person named in a statement of authority is conclusive in favor of a   transferee who gives value without notice that the person named in   the statement of authority lacks authority.          Sec. 253.008.  LIABILITY. (a) Except as otherwise provided   by this chapter, the debts, obligations, and liabilities of a   decentralized unincorporated association, whether arising in   contract, tort, or otherwise, are solely the debts, obligations,   and liabilities of the association. A member or administrator of a   decentralized unincorporated association may not be obligated   personally for any debt, obligation, or liability of the   association solely by reason of being a member or acting as an   administrator of the association.          (b)  Notwithstanding Subsection (a), a member or   administrator of a decentralized unincorporated association may,   under the governing principles of the association or under another   agreement, agree to be obligated personally for any or all of the   debts, obligations, and liabilities of the association.          (c)  The failure of a decentralized unincorporated   association to observe formalities relating to the exercise of the   association's powers or administration of the association's   activities and affairs may not be considered a ground for imposing   liability on a member or administrator of the association for a   debt, obligation, or other liability of the association.          Sec. 253.009.  CAPACITY TO ASSERT AND DEFEND; STANDING. (a)   A decentralized unincorporated association, in the association's   name, may institute, defend, intervene, or participate in a   judicial, administrative, or other governmental proceeding or in an   arbitration, mediation, or any other form of alternative dispute   resolution.          (b)  A member or administrator may assert a claim the member   or administrator has against the decentralized unincorporated   association. An association may assert a claim the association has   against a member or administrator.          Sec. 253.010.  EFFECT OF JUDGMENT OR ORDER. A judgment or   order against a decentralized unincorporated association is not by   itself a judgment or order against a member or administrator of the   association.          Sec. 253.011.  APPOINTMENT OF AGENT TO RECEIVE SERVICE OF   PROCESS. (a) A decentralized unincorporated association may file   in the office of the secretary of state a statement appointing an   agent authorized to receive service of process.          (b)  A statement appointing an agent must contain:                (1)  the name of the decentralized unincorporated   association;                (2)  the address in this state, including the street   address, if any, of the decentralized unincorporated association,   or if the association does not have an address in this state, the   association's address out of state; and                (3)  the name of the person in this state authorized to   receive service of process and the person's address, including the   street address, in this state.          (c)  A statement appointing an agent must be signed and   acknowledged by a person authorized to manage the affairs of the   decentralized unincorporated association. The statement must also   be signed and acknowledged by the person appointed agent, who by   signing accepts the appointment. The appointed agent may resign by   filing a resignation in the office of the secretary of state and   giving notice to the decentralized unincorporated association.          (d)  The secretary of state may collect a fee of $5 for filing   a statement appointing an agent to receive service of process, an   amendment, or a resignation under this section.          (e)  An amendment to a statement appointing an agent to   receive service of process must meet the requirements for execution   of an original statement.          (f)  If the secretary of state refuses to file a statement   appointing an agent, the secretary of state shall return it to the   decentralized unincorporated association or the association's   representative not later than the 15th day after the date the   statement was delivered and include a brief explanation in writing   of the reason for the refusal.          Sec. 253.012.  SERVICE OF PROCESS. In an action or   proceeding against a decentralized unincorporated association, a   summons and complaint or other process shall be served on:                (1)  an agent authorized by appointment to receive   service of process;                (2)  an appointed administrator of the association; or                (3)  a member, but only if the agent or administrator   described by Subdivisions (1) and (2) cannot be served.          Sec. 253.013.  CLAIM NOT ABATED BY CHANGE OF MEMBERS OR   ADMINISTRATORS. A claim for relief against a decentralized   unincorporated association does not abate merely because of a   change in the members or administrators of the association.          Sec. 253.014.  VENUE. Unless provided otherwise by other   law, venue of an action against a decentralized unincorporated   association brought in this state is determined in accordance with   the law applicable to an action brought in the state in which the   association has appointed an agent for service of process under   Section 253.011.          Sec. 253.015.  MEMBER NOT AN AGENT. A member of a   decentralized unincorporated association is not an agent of the   association solely by reason of being a member.          Sec. 253.016.  APPROVAL BY MEMBERS. (a) Except as otherwise   provided by a decentralized unincorporated association's governing   principles, the association must have the approval of the   association's members, attained in accordance with its governing   principles, to:                (1)  suspend, dismiss, or expel a member;                (2)  select or dismiss an administrator;                (3)  adopt, amend, or repeal the governing principles;                (4)  sell, lease, exchange, or otherwise dispose of   all, or substantially all, of the association's property outside   the ordinary course of the association's activities, regardless of   the association's goodwill;                (5)  dissolve the association under Section 253.026;                (6)  merge or convert the association as provided by   Section 253.028;                (7)  undertake any act outside the ordinary course of   the association's activities; or                (8)  determine the policy or purpose of the   association.          (b)  A decentralized unincorporated association must have   the approval of the members in accordance with its governing   principles to act or exercise a right for which the association's   governing principles require member approval.          (c)  Unless otherwise provided for in a decentralized   unincorporated association's governing principles, membership   interest in a decentralized unincorporated association is   calculated in proportion to the person's membership interest or   other property that confers onto the person a voting right in the   association.          Sec. 253.017.  USE OF DISTRIBUTED LEDGER TECHNOLOGY. (a) A   decentralized unincorporated association may provide for the   association's governance, in whole or in part, through distributed   ledger technology, including through a smart contract.          (b)  The governing principles for a decentralized   unincorporated association may:                (1)  specify whether any distributed ledger technology   used or enabled by the association is:                      (A)  immutable or subject to change by the   association; and                       (B)  fully or partially public or private,   including the extent of members' access to information; and                (2)  adopt voting procedures, which may include a smart   contract deployed to distributed ledger technology, that provides   for:                      (A)  proposals from administrators or members in   the decentralized unincorporated association for upgrades,   modifications, or additions to software systems or protocols;                      (B)  proposed changes to the decentralized   unincorporated association's governing principles; and                      (C)  any other matter of governance or relating to   the activities of the association that is within the purpose of the   association.          Sec. 253.018.  CONSENSUS FORMATION ALGORITHMS AND   GOVERNANCE PROCESS. In accordance with the association's governing   principles, a decentralized unincorporated association may:                (1)  adopt a reasonable algorithmic means for   establishing consensus for:                      (A)  the validation of records;                      (B)  the establishment of requirements,   processes, and procedures for conducting operations; and                      (C)  making organizational decisions with respect   to the distributed ledger technology used by the association; and                (2)  in accordance with a procedure adopted by the   association under Section 253.017, if any, and in compliance with   the requirements of law and the governing principles of the   decentralized unincorporated association:                      (A)  modify the consensus mechanism, including   the requirements, processes, and procedures for that mechanism; or                      (B)  substitute a new consensus mechanism,   including the requirements, processes, or procedures for that   mechanism.          Sec. 253.019.  DUTIES OF MEMBERS. (a)  A member of a   decentralized unincorporated association does not owe a fiduciary   duty to the association or to any another member of the association   solely by virtue of the person's membership in the association.          (b)  A member of a decentralized unincorporated association   shall discharge the duties and obligations under this chapter or   under the governing principles of the association and exercise the   member's rights in a manner consistent with the contractual   obligation of good faith and fair dealing.          Sec. 253.020.  ADMISSION, SUSPENSION, DISMISSAL, OR   EXPULSION OF MEMBERS. (a) A person becomes a member of a   decentralized unincorporated association in accordance with the   governing principles of the association. If there are no   applicable governing principles, a person:                (1)  is considered a member on the purchase or   assumption of a right of ownership of a membership interest or other   property or instrument that confers on the person a voting right in   the association; and                (2)  continues as a member of the association until the   earlier of the member's:                      (A)  resignation under Section 253.021; or                      (B)  suspension, dismissal, or expulsion under   Subsection (b).          (b)  A member may be suspended, dismissed, or expelled in   accordance with the governing principles of the decentralized   unincorporated association. If there are no applicable governing   principles, the member may be suspended, dismissed, or expelled   from an association only by a majority vote of the association's   members.          (c)  Unless the governing principles of a decentralized   unincorporated association provide otherwise, the suspension,   dismissal, or expulsion of a member does not relieve the member from   any obligation incurred or commitment made by the member in   connection with membership in the association before the member's   suspension, dismissal, or expulsion.          Sec. 253.021.  RESIGNATION OF MEMBER. (a) A member may   resign as a member of a decentralized unincorporated association in   accordance with the governing principles of the association. In   the absence of applicable governing principles, a member is   considered to have resigned on the voluntary or involuntary   disposal of all membership interest or other property or   instruments that confer on the person a voting right in the   association.          (b)  Unless a decentralized unincorporated association's   governing principles provide otherwise, resignation of a member   does not relieve the member from any unpaid capital contribution,   dues, an assessment, a fee, or another obligation incurred or   commitment made by the member in connection with membership in the   association before the member's resignation.          Sec. 253.022.  MEMBERSHIP INTEREST TRANSFERABLE. Except as   otherwise provided in the decentralized unincorporated   association's governing principles, a member's interest or a right   conferred in the association is freely transferable to another   person through conveyance of the membership interest or other   property that confers on a person a voting right in the association.          Sec. 253.023.  SELECTION OF ADMINISTRATORS; RIGHTS AND   DUTIES OF ADMINISTRATORS. (a) Except as otherwise provided by this   chapter or a decentralized unincorporated association's governing   principles, the members of an association may select the   association's administrators in accordance with Section 253.016.          (b)  An administrator may but is not required to be a member   of the association. If no administrators are selected, no member of   the association is an administrator.          (c)  A decentralized unincorporated association is not   required to have an administrator. There are no default   obligations of an administrator of a decentralized unincorporated   association. The rights and duties of an administrator of a   decentralized unincorporated association must be established as   part of the selection process for an administrator or   administrators of the association.          (d)  An administrator of a decentralized unincorporated   association does not have the authority to act on behalf of the   association beyond the specific authority granted in the selection   process of the administrator established under Subsection (c).          (e)  The governing principles of a decentralized   unincorporated association may, in a record, limit or eliminate the   liability of an administrator to the association or the   association's members for money damages for an action taken, or for   failure to take an action, as an administrator, except liability   for:                (1)  the amount of a financial benefit improperly   received by an administrator;                (2)  an intentional infliction of harm on the   association or the association's members;                (3)  an intentional violation of criminal law;                (4)  a breach of the duty of loyalty should one exist,   unless a full disclosure of all material facts, a specific act, or a   transaction that would otherwise violate the duty of loyalty by an   agent is authorized or ratified by approval of the disinterested   members in accordance with Section 253.016; or                (5)  an improper distribution.          Sec. 253.024.  RIGHTS OF MEMBERS AND ADMINISTRATORS TO   INFORMATION. (a) Except as provided by Subsection (b), on   reasonable notice, a member or administrator of a decentralized   unincorporated association is entitled to an electronic record of   any record maintained by the association regarding the   association's activities, financial condition, or other   circumstances to the extent the information contained in the record   is material to the member's or administrator's rights and duties   under the association's governing principles or this chapter.          (b)  A decentralized unincorporated association is not   obligated to provide a record maintained by the association for   record requests made through distributed ledger technology,   including through a smart contract, to a member or administrator if   the member or administrator has access to the information contained   in the record in a record made available to the member or   administrator on distributed ledger technology.          (c)  A decentralized unincorporated association may impose   reasonable restrictions on access to and use of information that   may be provided under this section, including by designating the   information confidential and imposing nondisclosure or other   safeguarding obligations on the recipient of the information.          (d)  A former member or administrator may have access to   information to which the member or administrator was entitled as a   member or administrator if:                (1)  the information relates to the period of time   during which the person was a member or administrator;                (2)  the former member or administrator seeks the   information in good faith; and                (3)  the former member or administrator satisfies the   requirements of Subsections (a), (b), and (c) with respect to the   information.          (e)  A decentralized unincorporated association has no   obligation to collect and maintain a list of members or member   information, including the names or addresses of members.          Sec. 253.025.  INDEMNIFICATION; ADVANCEMENT OF EXPENSES. A   decentralized unincorporated association is an enterprise, as that   term is defined by Section 8.001, for purposes of the requirements   related to indemnification and advancement of expenses under   Chapter 8.          Sec. 253.026.  DISSOLUTION; CONTINUATION OF EXISTENCE. (a)   A decentralized unincorporated association may be dissolved by any   of the following methods:                (1)  at a time or by a method for dissolution specified   by the governing principles of the association, if any;                (2)  if the governing principles of the association do   not provide a method for dissolution, with the approval of the   members of the association in accordance with Section 253.016;                (3)  if the number of members of the association is   fewer than 500 and the association is not able to use a merger or   conversion to form another valid entity under Chapter 10; or                (4)  by court order to dissolve.          (b)  After dissolution, a decentralized unincorporated   association continues in existence until the association's   activities are wound up and the association is terminated under   Section 253.027.          Sec. 253.027.  WINDING UP AND TERMINATION. (a) A dissolved   decentralized unincorporated association shall wind up the   association's business. The association continues in existence   after dissolution only for the purpose of winding up under this   section.          (b)  In winding up a decentralized unincorporated   association, the members:                (1)  shall discharge the association's debts,   obligations, and other liabilities, settle and close the   association's business, and marshal and distribute any remaining   property:                      (A)  in a manner required by law, other than this   chapter, that requires assets of an association to be distributed   to another entity or person with similar nonprofit purposes, if   applicable to the association;                      (B)  in accordance with the association's   governing principles, and in the absence of applicable governing   principles, to the current members of the association in proportion   to their membership interests; or                      (C)  if property cannot be distributed under   Paragraph (A) or (B), under the laws governing unclaimed property   for this state; and                (2)  may:                      (A)  appoint and authorize an administrator to   wind up the association in accordance with Section 253.017;                      (B)  preserve the association operations and   property as a going concern for a reasonable time;                      (C)  prosecute and defend civil, criminal, or   administrative actions and proceedings involving the association;                      (D)  transfer the association's property;                      (E)  settle disputes involving the association by   mediation or arbitration;                      (F)  receive reasonable compensation for services   rendered to the association in winding up the association; and                      (G)  perform other acts necessary or appropriate   to effect the winding up.          (c)  If the members of a decentralized unincorporated   association do not appoint an administrator to wind up the   association's business, the members shall owe the association a   duty of care in the conduct or winding up of the association   operations to refrain from engaging in:                (1)  grossly negligent or reckless conduct;                (2)  wilful or intentional misconduct; or                (3)  a knowing violation of the law.          Sec. 253.028.  MERGERS AND CONVERSIONS. A decentralized   unincorporated association may effect a merger or conversion by   complying with the applicable provisions of Chapter 10 and the   association's governing principles.          Sec. 253.029.  UNIFORMITY OF APPLICATION AND CONSTRUCTION.   This chapter shall be applied and construed to make uniform the law   with respect to the subject of this chapter among states enacting   it.          SECTION 7.  This Act takes effect September 1, 2023.